More than ever before, Canadian juniors are now looking overseas for new investment opportunities as exploration heads for a slowdown at home. A brief survey of junior mining companies by The Northern Miner reveals that more than 20 of them are currently working outside Canada on projects in Latin America, Africa, Indonesia, the Caribbean and Greenland.
The number of international projects by juniors is on the rise partly because mineral exploration in developed countries like Canada has become more difficult and costly.
The most accessible areas have already been extensively prospected, and showings that are easily located have already been found. Exploration for deep-seated or remotely located ore deposits is expensive and the rate of new gold discoveries has already begun to decline in central Canada.
At the same time, escalating environmental concerns are adding significantly to the costs of mine development, and access to geologically suitable areas for future exploration is being restricted, in some cases, by pressures to set aside areas solely for recreational use.
Changes in the flow-though tax treatment of money spent on mineral exploration in Canada has also dramatically reduced the amount of funding available to junior companies.
“There’s no question there has been a trend towards more international projects during the past couple of years,” says Alan Spence, who is president of Toronto-based South American Goldfields (TSE) — a junior firm with grassroots gold projects in Guyana, South America.
“Good results, wherever they are, will still create investor interest,” he tells The Northern Miner.
South American Goldfields recently reported encouraging gold results on its Akaiwong project joint ventured with Homestake (NYSE) in Guyana, as well as on its Aurora project where Denison Mines (TSE) is the operator. Diamond drilling is under way on another Goldfields/Denison joint venture called the Quartz Hill property. Quartz Hill borders the more advanced Omai gold project of Golden Star Resources (TSE). The latter company has retained Wright Engineers to finish a feasibility study at Omai after its former partner Placer Dome (TSE) withdrew from the venture earlier this year.
Golden Star, based in Edmonton, is currently concentrating its efforts on the development of gold and base metal deposits in Guyana and Bolivia. More than $10 million has been spent on the Omai property to date. Cambior (TSE) recently signed a deal to earn a 60% interest in Omai from Golden Star.
South America also remains the main focus for a host of other Canadian-based junior mining companies including Greenstone Resources (TSE), Minera Rayrock (TSE), and Glencairn Explorations (ASE) which is developing a small diamond mining operation at its Raw Bean project in northeastern Brazil. Another company well- known for its Brazilian gold mining operations is Consolidated TVX Mining (TSE). This company has the biggest investment in Latin America of any Canadian mining company. Historically, Cons. TVX’s activities have been mainly in Brazil, but Chile will become its main source of earnings in the future through its 40% stake in La Coipa, the big gold/silver mine operated by Placer Dome (TSE).
Meanwhile, Toronto-based Minera Rayrock says it is focusing on Costa Rica and Chile due to their stable economies, favorable geology, inexpensive exploration targets and potential for low-cost operations. Minera stresses that although each country is unique, the Chilean and Costa Rican governments strongly encourage foreign investment.
Rayrock has two major advanced-stage projects being evaluated for mine development — the Ivan copper project in northern Chile and the Bellavista gold project in Costa Rica. Toronto-based Greenstone Resources is also developing its El Recio gold project in Costa Rica, while Breakwater Resources (TSE) has purchased control of the El Mochito polymetallic mine in Honduras. Another company formed mainly to acquire and develop mining properties in Costa Rica is Ariel Resources (VSE) of Vancouver. Ariel is working on the Tres Hermanos and Esperanza mines and hopes to acquire other properties through the 1990s.
In Chile, a favorable investment climate combined with strong exploration potential have attracted a host of junior companies such as Bema Gold (TSE) which is developing the promising Refugio gold project in that country’s prolific Maricunga gold-silver belt. Other junior companies active in Chile include Dayton Developments (VSE), Bridger Resources (VSE) and Northgate Exploration (TSE). Major TSE-listed companies with big stakes in gold and base metal projects in Chile are Placer Dome, LAC Minerals (TSE), and Bond International Gold (TSE).
Another big spender in Latin America is Cominco International Resources (TSE), which has a 25.7% stake in the Marte gold mine and a 42.5% interest in the Quebrada Blanca copper deposit in Chile. Cominco also has a 50% interest in the Lobo gold deposit in Chile and 100% interest in the Mariquita copper project in Mexico. In the Middle East, Cominco has been reporting high-grade gold results recently from its exploration properties situated in Turkey where $2.5 million is being spent this year.
Pierre Lassonde, one of Canada’s most astute gold investors, discusses some interesting international trends for gold in the 1990s and beyond in his recent 182-page publication entitled The Gold Book.
He says that in Chile, the so- called Switzerland of South America, gold production is on the increase as dozens of multinational gold companies provide money and people. All this activity is happening, he says, because both the investment climate and geology of the country are favorable. “Chile will probably see more discoveries,” he says.
On the other side of the Atlantic Ocean, in Africa, companies such as Sikaman Gold Resources (TSE), Lencourt (TSE), Marshall Minerals (ASE) and Eden Roc Mineral (ASE) have projects for gold and other minerals under way. Lencourt is hoping to raise $4.6 million to acquire an African mining company called Sominki, which operates tin and gold mines in Zaire.
Meanwhile Toronto-based Sikaman is on schedule for plant commissioning in September at its 14% owned Bogosu gold project in Ghana. President Thomas Griffis says the US$86-million project is fully financed. Sikaman is also working on the Pulacayo and Sika gold-silver projects in Bolivia.
In The Gold Book, Lassonde says most of Africa has been bypassed by the 1980s boom in gold exploration as companies have avoided war-torn countries like Mozambique and Namibia or communist- led regimes in Zaire and Zambia. “We are seeing the tide turn and countries that have a rich history in gold mining, such as Ghana, are now looking to foreign investors to help them regain some of the past glories,” he says.
Working on a rather unusual gold project in southeastern Greenland is Toronto-based junior Platinova Resources (TSE) which is participating in the joint venture along with Corona (TSE). A $1.5-million drilling program comprising at least 12,000 metres is scheduled for completion by the end of September. The program will include bulk sampling, preliminary engineering and environmental studies.
Another company recently announcing a significant new overseas exploration project is Val d’Or, Que.-based Cambior (TSE). In its first major venture outside North America, the company is acquiring a 50% interest in a gold property in Indonesia from Dominion Mining of Australia. The property covers about 17,000 sq. km on the Island of Kalimantan. Cambior can earn its stake in the project spending A$8 million on exploration over a 3-year period with Dominion acting as operator.
More than ever before, Canadian juniors are now looking overseas for new investment opportunities as exploration heads for a slowdown at home. A brief survey of junior mining companies by The Northern Miner reveals that more than 20 of them are currently working outside Canada on projects in Latin America, Africa, Indonesia, the Caribbean and Greenland.
The number of international projects by juniors is on the rise partly because mineral exploration in developed countries like Canada has become more difficult and costly.
The most accessible areas have already been extensively prospected, and showings that are easily located have already been found. Exploration for deep-seated or remotely located ore deposits is expensive and the rate of new gold discoveries has already begun to decline in central Canada.
At the same time, escalating environmental concerns are adding significantly to the costs of mine development, and access to geologically suitable areas for future exploration is being restricted, in some cases, by pressures to set aside areas solely for recreational use.
Changes in the flow-though tax treatment of money spent on mineral exploration in Canada has also dramatically reduced the amount of funding available to junior companies.
“There’s no question there has been a trend towards more international projects during the past couple of years,” says Alan Spence, who is president of Toronto-based South American Goldfields (TSE) — a junior firm with grassroots gold projects in Guyana, South America.
“Good results, wherever they are, will still create investor interest,” he tells The Northern Miner.
South American Goldfields recently reported encouraging gold results on its Akaiwong project joint ventured with Homestake (NYSE) in Guyana, as well as on its Aurora project where Denison Mines (TSE) is the operator. Diamond drilling is under way on another Goldfields/Denison joint venture called the Quartz Hill property. Quartz Hill borders the more advanced Omai gold project of Golden Star Resources (TSE). The latter company has retained Wright Engineers to finish a feasibility study at Omai after its former partner Placer Dome (TSE) withdrew from the venture earlier this year.
Golden Star, based in Edmonton, is currently concentrating its efforts on the development of gold and base metal deposits in Guyana and Bolivia. More than $10 million has been spent on the Omai property to date. Cambior (TSE) recently signed a deal to earn a 60% interest in Omai from Golden Star.
South America also remains the main focus for a host of other Canadian-based junior mining companies including Greenstone Resources (TSE), Minera Rayrock (TSE), and Glencairn Explorations (ASE) which is developing a small diamond mining operation at its Raw Bean project in northeastern Brazil. Another company well- known for its Brazilian gold mining operations is Consolidated TVX Mining (TSE). This company has the biggest investment in Latin America of any Canadian mining company. Historically, Cons. TVX’s activities have been mainly in Brazil, but Chile will become its main source of earnings in the future through its 40% stake in La Coipa, the big gold/silver mine operated by Placer Dome (TSE).
Meanwhile, Toronto-based Minera Rayrock says it is focusing on Costa Rica and Chile due to their stable economies, favorable geology, inexpensive exploration targets and potential for low-cost operations. Minera stresses that although each country is unique, the Chilean and Costa Rican governments strongly encourage foreign investment.
Rayrock has two major advanced-stage projects being evaluated for mine development — the Ivan copper project in northern Chile and the Bellavista gold project in Costa Rica. Toronto-based Greenstone Resources is also developing its El Recio gold project in Costa Rica, while Breakwater Resources (TSE) has purchased control of the El Mochito polymetallic mine in Honduras. Another company formed mainly to acquire and develop mining properties in Costa Rica is Ariel Resources (VSE) of Vancouver. Ariel is working on the Tres Hermanos and Esperanza mines and hopes to acquire other properties through the 1990s.
In Chile, a favorable investment climate combined with strong exploration potential have attracted a host of junior companies such as Bema Gold (TSE) which is developing the promising Refugio gold project in that country’s prolific Maricunga gold-silver belt. Other junior companies active in Chile include Dayton Developments (VSE), Bridger Resources (VSE) and Northgate Exploration (TSE). Major TSE-listed companies with big stakes in gold and base metal projects in Chile are Placer Dome, LAC Minerals (TSE), and Bond International Gold (TSE).
Another big spender in Latin America is Cominco International Resources (TSE), which has a 25.7% stake in the Marte gold mine and a 42.5% interest in the Quebrada Blanca copper deposit in Chile. Cominco also has a 50% interest in the Lobo gold deposit in Chile and 100% interest in the Mariquita copper project in Mexico. In the Middle East, Cominco has been reporting high-grade gold results recently from its exploration properties situated in Turkey where $2.5 million is being spent this year.
Pierre Lassonde, one of Canada’s most astute gold investors, discusses some interesting international trends for gold in the 1990s and beyond in his recent 182-page publication entitled The Gold Book.
He says that in Chile, the so- called Switzerland of South America, gold production is on the increase as dozens of multinational gold companies provide money and people. All this activity is happening, he says, because both the investment climate and geology of the country are favorable. “Chile will probably see more discoveries,” he says.
On the other side of the Atlantic Ocean, in Africa, companies such as Sikaman Gold Resources (TSE), Lencourt (TSE), Marshall Minerals (ASE) and Eden Roc Mineral (ASE) have projects for gold and other minerals under way. Lencourt is hoping to raise $4.6 million to acquire an African mining company called Sominki, which operates tin and gold mines in Zaire.
Meanwhile Toronto-based Sikaman is on schedule for plant commissioning in September at its 14% owned Bogosu gold project in Ghana. President Thomas Griffis says the US$86-million project is fully financed. Sikaman is also working on the Pulacayo and Sika gold-silver projects in Bolivia.
In The Gold Book, Lassonde says most of Africa has been bypassed by the 1980s boom in gold exploration as companies have avoided war-torn countries like Mozambique and Namibia or communist- led regimes in Zaire and Zambia. “We are seeing the tide turn and countries that have a rich history in gold mining, such as Ghana, are now looking to foreign investors to help them regain some of the past glories,” he says.
Working on a rather unusual gold project in southeastern Greenland is Toronto-based junior Platinova Resources (TSE) which is participating in the joint venture along with Corona (TSE). A $1.5-million drilling program comprising at least 12,000 metres is scheduled for completion by the end of September. The program will include bulk sampling, preliminary engineering and environmental studies.
Another company recently announcing a significant new overseas exploration project is Val d’Or, Que.-based Cambior (TSE). In its first major venture outside North America, the company is acquiring a 50% interest in a gold property in Indonesia from Dominion Mining of Australia. The property covers about 17,000 sq. km on the Island of Kalimantan. Cambior can earn its stake in the project spending A$8 million on exploration over a 3-year period with Dominion acting as operator.
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